From information systems resources to effective use: Moderating effect of network embeddedness

Abstract

This research examines how organizations can achieve effective information systems (IS) use by aligning internal IS resources with embeddedness in the IS outsourcing network. Leveraging the empirical opportunity of large-scale organization-wide meaningful use attestation of electronic health records, we conducted a longitudinal analysis of US hospitals from 2013 to 2017. We found that an organization’s network embeddedness amplifies the positive relationship between IS resources and effective IS use. We also identify different impacts depending on network embeddedness types and organization sizes. We found positive moderating effects of structural and positional embeddedness. However, junctional embeddedness has no direct or moderating effect on IS use. In addition, the moderating effects manifest differently for different-sized organizations – i.e., structural embeddedness has a stronger positive moderating effect for large organizations, while positional embeddedness’ positive moderating effect is stronger for small organizations. We also found heterogeneous direct effects of structural and positional embeddedness on organizational IS use. Solely depending on structural embeddedness will result in lower IS use, which is more prominent for small organizations. Positional embeddedness has a negative direct effect on small organizations’ IS use but positively relates to large organizations’ IS use. This research highlights the role of network embeddedness in facilitating IS use and offers a nuanced understanding of its impacts. Our findings also provide practical implications for organizational IS use through strategic IS outsourcing.